TAIEX drops on Wall Street fall
The TAIEX closed down 0.68 percent yesterday after an overnight tumble on Wall Street amid concerns over the global economy and the latest spate of debt problems related to Ireland’s banking system, dealers said.
The TAIEX fell 56.67 points to 8,255.54, after moving between 8,228.24 and 8,284.51, on turnover of NT$81.70 billion (US$2.69 billion).
The market opened down 0.75 percent in a knee jerk reaction to Wall Street’s heavy losses, dealers said. The selling extended throughout the session, with the financial sector suffering the steepest decline, dealers said.
A total of 2,531 stocks closed down and 1,142 up, while 347 remained unchanged.
CPC Corp extinguishes fire
State-run CPC Corp, Taiwan (CPC, 台灣中油) said a fire at its Kaohsiung refinery has been extinguished without any impact on operations.
The fire occurred on a pipeline away from the plant’s main area and didn’t cause any disruption, CPC vice president Paul Chen (陳綠蔚) said by telephone yesterday.
Two contract workers suffered “slight” burns in the incident and have been treated in hospital and discharged, Chen said.
Taipower to increase bond issue
Taiwan Power Co (Taipower, 台電) plans to issue NT$109.3 billion (US$3.584 million) in bonds next year, more than the NT$89.2 billion sold this year, after posting a pretax loss of NT$16.2 billion for the period from January to last month, public relations representative Clint Chou (周義岳) said by telephone yesterday.
Fed stimulus to keep rates low
The US Federal Reserve’s new economic stimulus will keep interest rates at a record low in the West for an extended period, making global high-yield corporate bonds ideal investment options, ING Securities Investment Management Taiwan Ltd said yesterday.
Joep Huntjens, senior investment manager at ING, told a Taipei media gathering that the second quantitative easing measure adopted by the Fed, intended to avoid the double-dip recession scenario, would allow companies to raise funds at lower costs and many firms have issued new debts to pay down existing debts to save on interest expenses.
Huntjens said he expected high yield debts to generate an annualized return of 6.1 percent, 4.7 percent more than that of government bonds on average.
Globalsat approves bond plan
Globalsat Technology Corp’s (環天衛星科技) board approved a plan to sell up to NT$300 million in three-year unsecured domestic convertible bonds at zero coupon, the Taipei County-based company said in a statement to the Taiwan Stock Exchange yesterday.
The proceeds will be used to replenish working capital and repay debt, the GPS receiver maker said in the statement.
NT dollars falls on intervention
The New Taiwan dollar fell in late trading on speculation the central bank intervened to prevent currency gains from eroding exporters’ earnings.
The NT dollar earlier rose as much as 1.4 percent. It fell 0.2 percent to NT$30.793 against its US counterpart as of the 4pm close of trading, according to Taipei Forex Inc. The currency has strengthened 5.4 percent since June as overseas investors pumped US$6.8 billion into equities this year.
The central bank said yesterday that capital flows have become the main factor in the fluctuations of the exchange rate of a currency, and the NT dollar was no exception. Bigger currency fluctuation can help ease the impact from foreign capital flows, the bank said in a statement.
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